From: Giu1i0 Pri5c0 (gpmap@runbox.com)
Date: Fri Aug 01 2003 - 07:19:38 MDT
I have been following this in the last few days, and find it very, very interesting. But I am not sure I understand it well yet.
Of course I can see that idea futures markets with a large user base can distill what users view as the most probable outcomes on the basis of the information available, better than a single expert. It is a way of analysing available information by filtering personal biases out of the brainwork of many people who, since they were betting cash or reputation, have been thinking hard of the issue at hand.
But "available information" seems to me an important keyword. How can the system work when there is no information available? That is a definition of covert preparation, for example of terrorist attack: very little or no information is available to the external world. So why should an idea futures market work better than my, or your, blind guesswork?
Assuming that the system would work, we have here an idea that someone at DARPA has considered worth spending millions on, on the basis of operational considerations, then has been dropped on the basis of ethical and PC considerations. So this looks like a terrific business opportunity for the private sector, as the BBC author says. It would be interesting taking a look at the DARPA project documentation, that has disappeared from the DARPA website, does anyone have copies?
How could such a business be developed? Terrorism aside, how would a profit making version of Foresight Exchange work? The only possibilities that I can see are: - working with real cash and keeping a small fraction for system maintenance and development - selling advertising space on the website - selling analyses and results to buyers (e.g. selling the DoD the estimate of the system to terrorism in the Middle East). All three possibilities would become viable only after developing a very, very large user base.
I am sure this had been already discussed extensively, any pointers?
> I haven't been keeping up with this issue in the media, but I thought this
> would be of interest to those here who've been discussing it;
>
> >Why 'Terrordaq' will come - if the Pentagon likes it or not
>
> http://news.bbc.co.uk/2/hi/uk_news/magazine/3115777.stm
>
> >Plans to set up a stock market for tip-offs about terrorism have been
> >shelved by the US Government. But that won't stop someone else setting it
> >up - and may not even stop Osama bin Laden being able to make cash out of
> >betting on his own whereabouts.
> >The disgust was impossible to avoid. A leaked report from a unit within
> >the Pentagon which had the job of finding imaginative solutions to the
> >threat of terrorism had proposed setting up a market which traded in tips,
> >whispers and sensitive intelligence.
>
> >The theory was that the free market might have ways of winkling out
> >sensitive information that conventional sources could not.
> > THE BASICS
> >People bet on the likelihood of an event, eg an attack
> >With better information, traders are more likely to make money
> >It's in traders' interests to find inside tips, secret sources etc
> >Authorities could monitor sudden movements in the market, and take action
> >if necessary
> >
> >But the backlash to the idea came almost before the lash itself.
> >"Ridiculous and grotesque" said one US senator. Another claimed he
> >couldn't convince people it wasn't a hoax. The plug was pulled on the
> >screens at the innocuously titled Policy Analysis Market before it was
> >even open for business.
>
>
>
> James....
>
>
>
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